Introduction to Advertisement

1. Concept of Advertisement
 Advertisement/Ad/Ad-Film/Commercial
 From Latin word which means “to turn attention of people to specific
thing”
 Is a from of communication
 Represents the message/idea of the sender
 Targeted at a mass audience – mass persuasion apart from
disseminating information to target customers
 Not always the efficient way of reaching people
 Usually paid by sponsors and viewed on different media
 A combination of creativity, market research & economic
media
buying
 Diverse field
 Ultimate aim is to increase sales
2. Meaning & Definition
 Derived from Latin word ‘advertere’ which means to turn on attention
 Powerful communication medium & vital marketing tool to help sale
of goods
 Convinces people to buy product
 Contains information & persuasion
 According to America Marketing Association, “Advertising is any paid form
of non-personal presentation of ideas, goods or services by an identified
sponsor”
 According to William J. Stanton, “Advertising consists of all activities involved
in presenting to a group, a non-personal, oral or visual, openly-sponsored
message regarding a product, service or idea, this message is called
advertisement, is disseminated through one or more media and is paid for by an
identified sponsor”
3. Features of Advertisement

 Paid form  Non-personal

 Ideas, goods & services presentation &
promotion
 Controlled
 Identified
 Persuasive act
sponsor
 Competitive act  Mass communication
media
 Not neutral; not unbiased
 Informative act
4. Scope of Advertisement

1. Message 5. Advertiser
2. Media 6. Objectives
3. Merchandise 7. Activities
4. Advertising functions 8. Art & Science
5. Objectives of Advertisement
1. Informing
2. Influencing
3. Reminding
4. Adding Value
5. Assisting with other company efforts
6.Functions of Advertisement
1. Communication with 8. Reduce costs
customer
9.Lower prices
2. Persuasion
10.Competitive weapon
3. Contribution to
11.Brand image building
economic growth
12.Innovation 13.Growth of
4. Catalyst for change
media
5. Stimulates demand
6. Strengthens other
promotion mix
element
7. Develops brand
preference
 Principles of Advertisement
 Grab people
 Be clever & creative
 Speak loudly
 Do not make people think
 Use colors that make sense
 Be informative
 Be memorable
 Show not tell
 Use humor
Types of Advertisement
 Classification

 On basis of geographical spread

 On basis of target group
 On the basis of demand influence level
 On the basis of Corporate Philosophy
 On the basis of Timing of the response it elicits
 On the basis of media
 Miscellaneous
 A. On the basis of Geographical Spread

 Global Advertising
 National Advertising
 Local Advertising
 B. On the basis of Target Group

 Consumer Advertising
 Trade Advertising
 Industrial Advertising
 Professional Advertising
 C. On the basis of Demand Influence Level

 Primary Demand (Stimulation)

 Selective Demand (Stimulation)
 D. On the basis of Corporate
Philosophy
i. Corporate Advertising
ii. Brand Advertising
a. Informative Brand Advertising
b. Persuasive Brand Advertising
c. Reminder – Oriented Brand Advertising
d. Negative Advertising
 E. On the basis of the Timing of
Response it Elicits
i. Direct action advertising
ii. Indirect action advertising
iii. Surrogate advertising
 F.On the basis of media

 Audio
 Visual
 Audio-Visual
 Written
 Internet
 Verbal
 G. Miscellaneous

 Covert
 Institutional
 Product
i. Pioneering Advertising
ii. Competitive Advertising
iii. Reminder Advertising
Advantages of Advertisement
 To Manufacturers

 Increased sales
 Steady demand
 Lower costs
 Greater dealer interest
 Quicker turnover & smaller inventories
 Supplementing salesmanship
 Encouragement to better performance
 Creating goodwill
 To Consumers

 Facility of Purchasing
 Improvement in Quality
 Elimination of unnecessary intermediaries
 Consumer’s surplus
 Education of consumers
 To Society

 Generates employment
 Standard of living
 Stimulates research & development
 Promote art & culture
 Disadvantages of Advertisement

1. Multiplication of needs 7. Product proliferation

2. Misrepresentation of 8. Inefficient manufacturers
facts stay in business
3. Consumer's deficit 9. Propensity to consume
4. Increased cost 10.Deferred revenue
5. Wastage of national expenditure
resources 11. Managerial
6. Barriers to entry difficulties
Implications of Advertising
 Introduction
 Ads have social & legal implications
 When violated, social issues arise & government may take
corrective measures
 Society – decides what is offensive, excessive &
irresponsible
 Government – decides what is deceptive & unfair
 The implications are:
1. Social aspects of advertising
2. Economic aspects of advertising
3. Legal aspects of advertising
 1. Social Implications of Advertising

 To direct the desires of human beings

 Ads are the integral part of mass distribution of Industrial
Capitalism
 Objectives of marketers influence social values, lifestyle and
society’s tastes
 Generally agreed – Ads exert a powerful social influence & is
criticised for encouraging materialism in society
 Critics say ads should be informative instead of using
persuasion to influence the emotions, anxieties, etc
Positive Social Implications of Ads

 Informed society  Preventive course if

 Rights of Consumers dreaded diseases
 New ideas  Contribute to creativity of
people
 Environmental protection
 Social changes
 Quality consciousness
 Promotion of national
 Health & hygiene
interest
awareness
 Negative Social Implications of Ads

 Children & advertisement  Control of media

 Materialism &  Stereotypes
consumption  Religion & culture
 Wrong message  Undermines social values
 Message
problems
 2. Economic Implications of Ads

 Subsystem of economy – plays an important role in

economy
 Helps producer reduce costs
 Helps consumers widen choices
 Principles of free economies:
1. Self – interest
2. Perfect information
3. Many buyers & sellers
4. Absence of externalities
 Positive Economic Implications of Ads

 Effect on cost – Production,  Effect on demand

Distribution & Prices
 Effect on competition
 Effect on business cycle
 Advertising & creation of
utility
 Effect on product quality
 Effect on consumer
choice
 Effect on national
income
 Effect on employment
Negative Economic Implications of Ads

 Not productive  Forces people to desire & buy

 Multiplies needs things
 Monopoly argument  Increases cost of goods

 Restricts entry of new  Encourages waste

business units  Reduces consumer
 Widens business cycle choice
 Wastage of National
Resources
 3. Legal Implications of Ads

 Ads have been accused of many crimes – social, economic

& moral
 Gives exaggerated hopes to people
 Despite pitfalls, ads cannot be wished away
 Ads face legal restrictions
 Consumer-movement has forced government to
enforce laws to regulate advertising
 Need to Regulate Ads

 Morality & tastes

 Untruthful advertising
 Ads as Environment pollutant
 Legislative codes controlling Ads
 Indian Penal Code
(IPC), 1860
 Drugs & Cosmetics Act,
1940
 Drugs Control Act, 1950
 Young Persons (Harmful
Publications) Act, 1950
 Indecent Representation of
Women (Prohibition) Act, 1986
 Emblems & Names
(Prevention of Improper
Use) Act, 1950
 Prize Competitions Act,
1955
 Prevention of Insults to
National Honor Act, 1971
 Infant Milk Substitutes, Feeding
Bottles & Infant Foods (Regulation
of Production, Supply &
Distribution) Act, 1992
 Indian Copyright Act, 1957
 Trademarks Act, 1999
 Monopolies & Restrictive Trade
Practices (MRTP) Act, 1984
 Consumer Protection Act,
1986
 Cigarettes & Other Tobacco
Products Act, 2003
Setting Advertisement Objectives
 Introduction

 Objectives – end point towards which every activity of an

organization is oriented
 Philip Kotler – “The objectives of advertising is to
communicate to a defined audience, the necessary information
that simulates action in a given period of time”
 Setting objectives is the integral part of planning process
 If objectives are not formulated clearly, ads can fail
Functions of Advertisement Objectives

 Serves as Communication & Coordination Device

 Criterion for Decision-Making
 Evaluation of Advertising Effectiveness
 Types of Advertising Objectives

1. Sales Objectives
2. Communication Objectives
3. Specific Objectives of Advertising
 1. Sales Objectives

 To sell product & raise level of present sales

 When objectives are sales, a definite & quantifiable
perspective should be present
 If sales increase after an ad campaign, the campaign is successful
Limitations:
 Ads not the only factor affecting sales
 Effect on sales is in long run
 2. Communication Objectives

1. To increase brand awareness

2. To increase knowledge
3. To create linking
4. To induce preference
3. Specific Objectives of Advertisement
1. To increase demand 9. To reach customers left out
2. To sell new product/ by sales man
build new brand 10.To inform about changes in
3. To educate masses marketing mix

4. To build brand 11. To neutralize

preference competitor’s ads

5. To build good will 12. To enter in new

geographical area
6. To attract & help
middlemen 13.To do entire selling job

7. To support sales 14.To overcome

team dissonance of buyers

8. To remind customers of 15.Specific objectives of

product & company classified ads
Advertisement Agencies
 Introduction

 A service business dedicated to creating, planning & handling

advertising (and sometimes other forms of promotions) for its
clients
 George E. Belch – “Advertising agency is a service organization
that specializes in planning and executing advertising programs
for its clients”
 Functions of Advertising Agency

1. Contacting clients 7. Ad-Execution

2. Advertising Planning 8. Evaluation Function
3. Creative Function 9. Marketing Function
4. Developing & Preparing 10. Research Function
Advertising Copy 11. Accounting Function
5. Approval from Client
6. Media selection & Media
Scheduling
Organizational Structure of Advertising
Agency
 Types of Advertising Agencies

7. Sweet Shops
1. Full-Service Agencies
8. Interactive Agencies
2. In-House Agencies
9. Search Engine Agencies
3. Creative Boutiques
10. Health Care
4. Media Buying Services Communications
5. A La Carte Agency Agencies
6. Special Service 11. Medical Education
Agency(Group) Agencies
i. Promotional
Education
ii. Continuing Medical
Education
 Services offered by various Agencies

1. Account services 6. Media buying services

2. Marketing Services 7. Special services
3. Research services 8. Direct response services
4. Media services 9.Sales promotion services
5. Creative services 10.Sponsorship services
 Selection of Advertisement Agencies

 Agencies vary widely in their focus

 Some cater to only a few larger clients & do not
generally accept new accounts
 Others have hundreds of clients
 It is important for businesses to work hand in hand with
agencies
 Many factors come into play when choosing advertising agency
 Criteria for selection & evaluation of Ad
agencies
1. Location 7. Creative skills & new
2. Size ideas

3. Agency working for 8. Past record of agency

competitors 9. Quality & calibre of
4. Image of agency staff

5. Service offered by 10. Financially sound

agency 11. Agency experience
6. Rates charged
 Remuneration Strategies for Ad agencies

1. Commission
2. Fee arrangement
3. Cost plus agreement
4. Incentive based compensation
5. Percentage charges
6. Speculative basis
5. Advertisement Campaigns
 Meaning & Definition

 Advertising campaign is a series of advertisement messages that

share a single idea & theme which make up an IMC
 Advertising campaigns appear across different media such as
radio, tv & internet
 According to Dunn & Barban “ An advertising campaign includes a
series of ads, placed in various media, which are designed to meet
objectives, and are based on analysis of marketing &
communication situations”
 Importance of Ad Campaigns

 Establish a feel of urgency for the buyer

 Advertiser’s benefit concerns
 Avoiding failure
 Consumer’s benefit concern
 Compliments to production area
 Factors influencing planning of Ad
campaigns
1. Organization 7. Media
2. Advertising budget 8. Sales promotion efforts
3. Product 9. Identification of current
4. Consumers problems

5. Language 10. Government regulations

6. Competitors 11. Advertising objectives

End of Unit - I

Thank You!